The Ontario Superior Court of Justice recently dealt with the interesting issue of what an arbitrator must consider when making a determination about a party’s request to adjourn an arbitration hearing, so as to ensure that all parties are treated equally and fairly.

What Happened?

The parties signed their minutes of settlement in September 2011, which resolved the issue of child support for their two children, born in December 1995 and November 1991. At that time, the parties agreed to refer any future disputes regarding child support to arbitration with an arbitrator, AC.

A disagreement later arose with respect to the child support obligations of the father. In January 2015, the parties signed an arbitration agreement, agreeing to submit the dispute to arbitration with AC.

Less than one month later, the father sought an adjournment on the basis that he was going to be out of the country on those dates, and on the basis that he might retain an expert, which AC granted. In a pre-arbitration conference later that year, AC again adjourned the hearing.

Eight days before the new arbitration date, the father dismissed his lawyer, indicating that he had lost confidence in his counsel. The father asked AC to cancel the arbitration until such time as he received legal advice from his new lawyer.

AC rejected the father’s request for an adjournment, stating that he had had ample notice of the hearing dates, and that the termination of the solicitor/client relationship was at the father’s initiative.

The father attended the arbitration hearing unrepresented, but indicated that he was not prepared to represent himself at the hearing and that he felt that he was being pushed into the arbitration without proper legal advice.

The arbitrator decided in favour of the mother. The father brought an application for judicial review, seeking to set aside the arbitrator’s award.

The Relevant Legislation

The court outlined that, under s. 46(1) of the Arbitration Act, an arbitration award may be set aside on any of the following grounds:

• A party entered into the arbitration agreement while under a legal incapacity.
• The arbitration agreement is invalid or has ceased to exist.
• The award deals with a dispute that the arbitration agreement does not cover or contains a decision on a matter that is beyond the scope of the agreement.
• The composition of the arbitral tribunal was not in accordance with the arbitration agreement or, if the agreement did not deal with that matter, was not in accordance with this Act.
• The subject-matter of the dispute is not capable of being the subject of arbitration under Ontario Law.
• The applicant was not treated equally and fairly, was not given an opportunity to present a case or to respond to another party’s case, or was not given proper notice of the arbitration or of the appointment of an arbitrator.
• The procedures followed in the arbitration did not comply with this Act.
• An arbitrator has committed a corrupt or fraudulent act or there is a reasonable apprehension of bias.
• The award was obtained by fraud.
• The award is a family arbitration award that is not enforceable under the Family Law Act.

The Court’s Decision

The court began by referring to a previous Ontario court decision, which states that a breach of the obligation to treat the parties fairly and equally constitutes a breach of natural justice, and that the court has the authority to intervene where a decision amounts to a denial of natural justice.

The court also referred to another previous Ontario court case, in which the judge found:

The Arbitration Act requires an arbitrator to treat the parties equally and fairly. However, the Act does not equate treating the parties ‘equally and fairly’ with ‘the opportunity to present a case and respond to the other parties’ cases’. In fact, these elements of the arbitral process are listed as two distinct and separate requirements and are contained in different subsections of the Act. To provide an opportunity to present a case and respond to the other’s case does not, therefore satisfy the requirement that the parties be treated equally and fairly. Both requirements must be met by the arbitrator.

Finally, the court reviewed a non-exhaustive list of procedural and substantive factors that an arbitrator ought to consider in deciding whether to grant or refuse an adjournment.

Specifically, factors which may support the denial of an adjournment include:

• A lack of compliance with prior court orders.
• Previous adjournments that have been granted to the applicant.
• Previous peremptory hearing dates.
• The desirability of having the matter decided.
• Finding that the applicant is seeking to manipulate the system by orchestrating delay.

Alternatively, factors which may favour the granting of an adjournment include:

• The fact that the consequences of the hearing are serious.
• The fact that the applicant would be prejudiced if the request were not granted.
• A finding that the applicant was honestly seeking to exercise his right to counsel, and had been represented in the proceedings up until the time of the adjournment request.

In weighing these factors, the timeliness of the request, the applicant’s reasons for being unable to proceed on the scheduled date and the length of the requested adjournment should also be considered.

With these principles in mind, the court questioned whether the father in this case had been treated equally and fairly, and given an opportunity to present his case or to respond to the mother’s case. The court determined that he was not.

The court found that there was nothing which indicated that AC considered the father’s actual reason for requesting the adjournment, namely that he wanted the opportunity to retain new counsel. The court noted that there was no analysis by AC of previous lack of compliance with court orders, previous adjournments, the desirability of having the matter decided, the consequences of the hearing, the prejudice to the father if the adjournment was not granted or the prejudice to the mother if it was, or whether the father was honestly seeking to exercise his right to counsel or not.

In weighing the factors above, the court found that the father was represented throughout the proceedings; that he advised AC within an hour of having dismissed his lawyer; that he lost confidence in and dismissed his lawyer, which was his right; and that he was required to attend the arbitration without counsel because he had not had an opportunity to yet retain new counsel, and because he felt he had no choice.

In the end, the court found that the father was prejudiced by AC’s refusal to grant an adjournment, and that the breach of the obligation to treat the father fairly and equally pursuant to s. 19 of the Arbitration Act constituted a breach of natural justice. As a result, the court removed AC as the arbitrator and set aside the arbitration award. The issues in dispute were remitted to arbitration with another arbitrator.

Lessons Learned

While deference must be given to the discretionary decision of an arbitrator to grant or refuse an adjournment, the exercise of that discretion must be done judicially.

If you have questions about your rights in relation to a separation or divorce, contact Gelman & Associates. We strive to provide you with the information and resources necessary to make informed decisions about your family law matters. In addition to our firm’s handbook on separation and divorce and numerous web-based resources, we give all prospective clients a comprehensive family law kit during their initial consultation, which includes detailed information and resources to help individuals understand and navigate the separation and divorce process.

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